Indian Tribes diversify income beyond casinos

Tribal casinos account for about one-sixth of all the revenue generated by gambling and gaming in the United States. These enterprises have helped to transition many of the nations indigenous communities from surviving on grants and federal payments to income generation through development on their native lands.

One of the explicit goals established in the Indian Gaming Regulatory Act (IGRA) is to promote tribal economic development and self-sufficiency. And although gambling revenue generated from the nation’s 459 tribal casinos in 28 states remains substantive, diversification in which to build even greater economic stability has become the new hallmark.

For many tribes, extending revenue beyond casino operations has meant adding non-gaming sources like retail and outlet shopping malls or entertainment and sports venues, to become what is now commonly referred to as “integrated resorts.” But for a few tribal groups, diversification is coming into fruition by utilizing the revenue generated through gaming to then monetize investments outside the gambling industry.

In a recent New York Times feature, some examples of this trend, including the Nottawaseppi Band developing a solar power company, were provided by reporter Steve Friess. He quoted tribal chairman Homer Mandoka as stating that diversification isn’t possible without funds or access to funds, and that for most tribes, access to funding came with the successful operation of casinos.

Economic diversification outside the casino and hospitality business model include business management and investment via holding companies, investments in indigenous community life-style related industries like farming and fish-net manufacturing, or even providing human resources management for large-scale service industry contracts.

In 2013 Washington State attorney W. Gregory Geudel authored the book “Strategies and Methods for Tribal Economic Development: Building Sustainable Prosperity in Native American Communities.” More recently, in the American Indian Law Journal, he penned the study, “Sovereignty, Economic Development, and Human Security in Native American Nation” – and the research data provided has been interpreted and reported by many news sources and from a myriad of perspectives.

For instance, The Economist focused almost exclusively on the relationship between tribes that give cash from casino revenue directly to members, and tribes that don’t – emphasizing “growing tribal gaming revenues make poverty worse” – despite overwhelming evidence otherwise. Friess’ NYT article however focuses instead on the progressive efforts being put forth by many tribes to build a better, more self-sufficient future – just as the IGRA envisioned.

Clearly gambling revenue has changed the lives of many indigenous peoples, and in most instances for the better. And as their business acumen continues to develop, diversification outside the gaming industry is inevitable.

Indian Tribes diversify income beyond casinos was last modified: October 27th, 2015 by D. Graham